(CN) - A Palestinian pension fund cannot intervene in an injunction that froze assets of organizations tied to a Hamas terrorist attack that claimed the lives of two U.S. citizens in Israel, the 1st Circuit ruled.
A federal judge ordered Palestinian President Yasser Arafat, the Palestinian Authority and the Palestinian Liberation Organization to pay the estate of Yaron Unger $116 million after a group affiliated with Hamas murdered Unger and his wife Efrat while they were in Israel.
Unger's estate won an injunction to freeze interests that the PA and PLO held in the U.S. - including assets held by Swiss American Securities for a Palestinian pension fund for Gaza Strip state employees - when those parties disputed the judgment.
The pension fund claimed it was not connected to either the PA or PLO and sought to intervene in the injunction. That was after the estate filed a declaratory judgment against Swiss American and the fund in a New York state court.
But 1st Circuit appeals court in Boston ruled that the pension fund failed to establish a stake in the underlying action.
"The fund asserts that it possesses the requisite interest because the injunction, as a practical matter, is restraining its assets," Judge Bruce Selya wrote for the three-judge panel. "In the same breath, however, it assures us that the assets in question do not belong to either the PA or the PLO (and, thus, do not come within the sweep of the injunction)." (Parentheses in original.)
"The short of it is that the fund wants to challenge the injunction while at the same time insisting that the injunction does not apply to it," the ruling states. "The fund cannot have it both ways."
The fund complained that the injunction prevented it from managing its Swiss American assets, but the Selya said that claim "missed the mark."
"It is not the injunction that is the problem; it is the fund's inability to date to prove that the assets are unaffected by the injunction," the judge wrote. "That, of course, is the subject of the New York declaratory judgment proceeding, where the issue may be resolved."
Finally, the court rejected as "baseless" the fund's argument that the estate should post a bond to compensate the fund for its losses.
"The fund is not a defendant and insists that it is not subject to the injunction," Selya wrote. "Thus, the fund lacks standing to complain about the absence of a bond."
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